XL Group Ltd, through its subsidiaries, operates as an insurance and reinsurance company worldwide. The company operates in two segments, Insurance and Reinsurance. The Insurance segment offers casualty programs comprising primary and excess casualty, environmental liability, and excess and surplus lines; energy, property, and construction insurance; professional lines, such as directors', officers' liability, errors and omissions, employment practices, crime, fiduciary, technology, and cyber liability coverages; and specialty lines, including the aviation and satellite, marine, fine art and specie, equine, livestock and aquaculture, crisis management, political risk, trade credit and life, and accident and health insurance products. The Reinsurance segment provides casualty reinsurance products, including general and professional liability, and automobile liability and workers' compensation; property reinsurance products comprising property catastrophe, property risk excess of loss, and property proportional; specialty reinsurance products, such as energy, marine, aviation, and space; and other reinsurance products, including fidelity, surety, trade credit, accident and health, mortgage, and political risk. It also writes whole account capital gearing quota share contracts on select syndicates at Lloyd's. The company markets its products and services to the industrial, commercial, professional, and insurance companies, as well as other enterprises through international, national, and regional producers, acting as the brokers and representatives of policyholders. XL Group Ltd was founded in 1986 and is based in Hamilton, Bermuda.
Business Analysis of XL Group
The Insurance Sector is witnessing a major shakeup, new age business models in the industry are transforming both customers and businesses. Faced with this uncertainity, companies are investing resources to transform their business. An in-depth business analysis is a valuable resource to identify and articulate the need for a business model change. At R&P Research we believe, the starting point for a business analysis is Benchmarking. Business benchmarking can be done at various levels: 1) Industry Benchmarking 2) Peer Benchmarking 3) Disruptors Benchmarking. In this report, we share the snapshot of how XL Group compares against the industry on the major performance indicators. This analysis, along with peer group/disruptors benchmarking and revenue model understanding can help identify growth and cost optimization opportunities to maximize the value delivered by XL Group to its stakeholders. R&P Research Industry Intelligence Platform provides historical data for last 15 years with an easy to use benchmarking interface for an in-depth comparative business analysis.
Here is the performance snapshot of XL Group with an interactive chart.
- Revenue Growth: XL Group reported a revenue growth of 13.3% year-on-year during 2016. Property & Casualty Insurance Industry grew at 6.6% in the same period
- COGS share of Revenues: As a percentage of revenue, XL Group spent 57.9% of its total revenues on COGS. Property & Casualty Insurance industry average (COGS share of revenue) in the same period was 65.6%
- R&D share of Revenues: XL Group R&D share of Revenues details are not available because either company does not share the data or we do not have it
- SG&A share of Revenues: As a percentage of revenue, XL Group spent 34.9% of its total revenues on Sales, Marketing, and General Administration (SG&A). Property & Casualty Insurance industry average SG&A spending in the same period was 14.9%
- Inventory share of Revenues: XL Group Inventory share of Revenues details are not available because either company does not share the data or we do not have it
- Accounts Payable share of Revenues: As a percentage of revenue, XL Group invested 25.4% of its total revenues on Accounts Payable (A/P) Property & Casualty Insurance industry average Accounts Payable investment in the same period was 18.9%
- Accounts Receivable share of Revenues: As a percentage of revenue, XL Group invested 59.1% of its total revenues on Accounts Receivable (A/R). Property & Casualty Insurance industry average Accounts Receivable investment in the same period was 33.0%
- PP&E share of Revenues: XL Group PP&E share of Revenues details are not available because either company does not share the data or we do not have it
- Intangibles share of Revenues: As a percentage of revenue, XL Group invested 20.9% of its total revenues on Intangibles. Property & Casualty Insurance industry average Intangibles investment in the same period was 29.7%
- Net Margins: XL Group Net Margins in the year 2016 were 4.2%. Property & Casualty Insurance industry average Net Margins in the same period were 8.2%
Sector and Industry Association of XL Group
For the purpose of performance benchmarking of a company with a sector or industry average, R&P Research associates every company with one sector and one industry. An industry consists of companies with related/similar business models. A sector comprises of a group of related/similar industries. For high-level analysis purposes, related/similar sectors are grouped into sector groups.
XL Group is associated with Financials Sector Group, Insurance Sector, and Property & Casualty Insurance Industry.
Insurance sector is comprised of the following industries: Life Insurance; Property & Casualty Insurance; Surety & Title Insurance; Insurance Brokerage; Diversified Insurance. The definitions for each of the industries is as follows:
- Life Insurance industry includes companies engaged principally in life insurance.
- Property & Casualty Insurance industry includes companies engaged principally in accident, fire, automotive, marine, malpractice and other classes of non-life insurance.
- Surety & Title Insurance industry includes companies providing title & surety insurance.
- Insurance Brokerage industry includes insurance brokers and agencies.
- Diversified Insurance industry includes companies with life, health, property & casualty, and reinsurance interests, none of which predominates.
Industry Ranking of XL Group
With $10.5 billion revenues, XL Group ranked number 9 of all the companies in the US Property & Casualty Insurance industry. There were a total of 66 public companies in the US Property & Casualty Insurance industry that had revenues greater than $50 million during 2016.
The top-10 companies in the US Property & Casualty Insurance industry by revenues during 2016 were:
Business Model Analysis (BMA) Framework
We use the following framework to assess the business model of a company. Business Model Analysis framework can be used by organizations to articulate growth strategies and identify cost optimization opportunities. Technology and consulting companies can use this framework to identify the value drivers and pain points of their targeted customers. Entrepreneurs can use this framework to understand the language of business and identify promising business opportunities. This framework can be used by any professional aspiring to take up a leadership role to better understand the businesses challenges, articulate growth strategy, and monitor the business improvement requirements for the organization.